CLUEY LTD — Interim / Quarterly Report 2021

Apr 19, 2021

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ASX Announcement

Tuesday, 20 April 2021

Appendix 4C and Quarterly Activities Report January – March 2021

Cluey Ltd (ASX: CLU) (“Cluey” or “the Company”) has released its Appendix 4C Quarterly Cashflow Report and Quarterly Activities Report for the period from 1 January 2021 to 31 March 2021.

Cluey was admitted to the ASX on 9 December 2020, however the year-to-date amounts in the Appendix 4C represent the nine months of activities from 1 July 2020 to 31 March 2021.

ENDS

Authorised for release to the ASX by the Board of Cluey Ltd.

For enquiries please contact:

Investors

Mark Rohald Greg Fordred CEO CFO & Company Secretary investor.relations@clueylearning.com investor.relations@clueylearning.com

ABOUT CLUEY

Cluey is an innovative, ASX-listed Edtech company that combines education, technology and data to deliver quality education outcomes and an enhanced experience for students. Cluey has a highly experienced management team and Board with a track record of building successful education businesses and is supported by an Independent Education Advisory Board comprising five eminent independent education sector thought leaders.

Cluey has been recognised in the prestigious HolonIQ inaugural list of most innovative Edtech companies in Australia.

Cluey Ltd

Cluey Ltd Quarterly Activities Report

January – March 2021

This report accompanies the Appendix 4C Quarterly Cashflow Report and provides an update and explanation of significant events in the quarter ended 31 March 2021 (“Q3 FY2021”).

Highlights and key business activities

The business continued to perform strongly in Q3FY2021, notwithstanding the impact of the school holidays in January, where approximately 50% of students pause their sessions.

During the quarter, the business achieved:

• record new student enrolments of 5,848, an increase of 144% on the prior corresponding period (“Q3 FY2020”) and 15% favourable to forecast[1] .

• record number of student sessions of 61,060, an increase of 198% on the prior corresponding period and 10% favourable to forecast[1] .

• Variable CAC[2] per new student of $567, a reduction of 24% on the prior corresponding period and in line with forecast[1] , notwithstanding the 144% increase in the number of new students.

Operating activities

Cluey, via its wholly owned subsidiary, Cluey Learning Pty Ltd ACN 620 549 019, has continued to provide personalised online tutoring and educational support to Australian school students in the quarter.

Significant cash receipts and payments disclosed in the Appendix 4C include:

• Cash receipts from customers of $4.5 million in the quarter, representing growth of 40% on cash receipts of $3.2 million in Q2 FY2021, and growth of 223% on cash receipts of $1.4 million in the prior year corresponding period (“Q3 FY2020”). Total cash receipts for the nine months to 31 March 2021 were $11.6 million.

• Cash receipt of $0.3 million for R&D Incentive refundable tax offset relating to FY2020.

• Cash payments for advertising and marketing (including the payment of accruals and prepayments) in the quarter of $2.5 million, and $5.4 million for the nine months to 31 March 2021. Cash payments for advertising and marketing increased 82% from $1.4 million in Q2 FY2021, including increased investment in brand advertising (TV commercials and infomercials), delivered an increase in new students of 130% on Q2 FY2021.

• Cash payments to staff and tutors in the quarter of $4.9 million, and $15.0 million for the nine months to 31 March 2021.

The business is performing in line with expectations and the IPO Prospectus dated 23 October 2020 (“the Prospectus”), and as previously announced to the market on 8 December 2020.

1 Being the Q3FY2021 component of the annual forecast provided in the Prospectus.

2 Variable CAC (customer acquisition costs) per student is a non-IFRS measure used for management purposes which represents variable acquisition expenditure for a period divided by new students with a session in the same period. Variable acquisition expenditure is calculated based on total marketing expenses, plus learning advisor (sales) employment costs and commission (included in employee benefits expense).

Cluey Ltd

Use of funds

The Company prepared the Prospectus in relation to the Offer of 25.1 million shares at an issue price of $1.20 per share to raise $30 million.

In Section 1.8 of the Prospectus, the Company provided a proposed use of funds statement. The table below only shows the use of funds from the date of admission to the ASX (however the Appendix 4C YTD column covers the period from 1 July 2020 to 31 March 2021).

2021).
Use of funds	Total per the Prospectus $m	Actual expenditure 8/12/20 to 31/3/21 $m	Commentary
Sales & Marketing	10.9	4.4	In line with expectations
Product, Customer Care, Education & Technology	5.8	1.9	In line with expectations
Expenses associated with the IPO	3.4	3.3	In line with expectations – note that all IPO costs are included, including those incurred prior to 8/12/20
Working Capital	9.9	0.0	Currently funded from working capital reserves prior to IPO
Total	30.0	9.6

Total cash on hand as at 31 March 2021 was $31.9 million.

Payments to Directors and Related Parties

During the quarter, the following payments to Directors and Related Parties were made:

• $55,558 included in cashflows from operating activities. These payments were to Executive Directors for net salary and fees, and expense reimbursements, and to Non-Executive Directors for fees.

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Cluey key facts:

• Cluey provides support for students in years 2-12 in Mathematics and English and years 11-12 in Chemistry, as well as test preparation for NAPLAN and Literacy and Numeracy Test for Initial Teacher Education;

• Through regular live online tutoring sessions, Cluey’s learning model is underpinned by personalised and tailored programs, content mapped to the national and state curricula, targeted tutor feedback and comprehensive reporting to students and parents;

• Cluey’s platform captures > 100,000 data points in every learning session to deliver valuable data-driven insights in teaching and learning using proprietary analytics;

• Strong student and customer feedback with 91% of students rating their session experience positively and 82% of parents agreeing that their child’s grades have improved since using Cluey; and

• Cluey is headquartered in Sydney, Australia. At the end of March 2021, Cluey had 99.7 full-time equivalent staff and 1,044 qualified tutors.

Cluey Ltd

Cluey Ltd

ASX: CLU

Appendix 4C

Quarterly cashflow report for entities subject to Listing Rule 4.7B

Name of entity

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Cluey Ltd
ABN Quarter ended ("current quarter")
65 644 675 909 31 March 2021
Consolidated statement of cash flows Current quarter Year to date
(9 months)
$A'000 $A'000
1. Cash flows from operating activities
1.1 Receipts from customers 4,535 11,568
1.2 Payments for: 0 0
(a) research and development 0 0
(b) product manufacturing and operating costs 0 0
(c) advertising and marketing (2,466) (5,431)
(d) leased assets (73) (246)
(e) staff costs [1] (4,881) (15,038)
(f) administration and corporate costs (1,130) (2,875)
1.3 Dividends received 0 0
1.4 Interest received 27 98
1.5 Interest and other costs of finance paid (refer item 3.9) 0 0
1.6 Income taxes paid 0 0
1.7 Government grants and tax incentives 309 359
1.8 Other (provide details if material) - IPO related costs [2] (96) (1,283)
1.9 Net cash from / (used) operating activities (3,775) (12,848)
1 Staff costs (item 1.2) include payments to tutors for their service in the provision of online tutoring
2 IPO related costs (in item 1.8) excludes costs related to the issue of new shares shown in item 3.4
2. Cash flows from investing activities
2.1 Payments to acquire or for:
(a) entities 0 0
(b) businesses 0 0
(c) property, plant and equipment (28) (80)
(d) investments 0 0
(e) intellectual property 0 0
(f) other non-current assets 0 0
2.2 Proceeds from disposal of: 0 0
(a) entities 0 0
(b) businesses 0 0
(c) property, plant and equipment 0 0
(d) investments 0 0
(e) intellectual property 0 0
(f) other non-current assets 0 0
2.3 Cash flows from loans to other entities (0) (0)
2.4 Dividends received 0 0
2.5 Other (provide details if material) 0 0
2.6 Net cash from / (used in) investing activities (28) (80)
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Cluey Ltd

ASX: CLU

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Consolidated statement of cash flows Current quarter Year to date
(9 months)
$A'000 $A'000
3. Cash flows from financing activities
3.1 Proceeds from issues of equity securities (excluding 38 30,069
convertible debt securities) [3]
3.2 Proceeds from issue of convertible debt securities 0 9,505
3.3 Proceeds from exercise of options 0 0
3.4 Transaction costs related to issues of equity securities or convertible (85) (2,430)
debt securities
3.5 Proceeds from borrowings 0 0
3.6 Repayment of borrowings 0 0
3.7 Transaction costs related to loans and borrowings 0 0
3.8 Dividends paid 0 0
3.9 Other (provide details if material) - interest and compensation 0 (6,229)
payments relating to convertible debt securities
3.10 Net cash from / (used in) financing activities (47) 30,915
3 Proceeds from issues of equity securities (item 3.1) includes settlement of employee loans and release of associated Treasury
shares
4. Net increase / (decrease) in cash and cash equivalents
for the period
4.1 Cash and cash equivalents at beginning of period 35,728 13,891
4.2 Net cash from / (used in) operating activities (item 1.9 above) (3,775) (12,848)
4.3 Net cash from / (used in) investing activities (item 2.6 above) (28) (80)
4.4 Net cash from / (used in) financing activities (item 3.10 above) (47) 30,915
4.5 Effect of movement in exchange rates on cash held 0 0
4.6 Cash and cash equivalents at end of period 31,878 31,878
5. Reconciliation of cash and cash equivalents Current quarter Previous quarter
$A'000 $A'000
at the end of the quarter (as shown in the consolidated
statement of cash flows) to the related items in the accounts
5.1 Bank balances 3,368 728
5.2 Call deposits 28,510 35,000
5.3 Bank overdrafts 0 0
5.4 Other (provide details) 0 0
5.5 Cash and cash equivalents at end of quarter (should equal
item 4.6 above) 31,878 35,728
6. Payments to related parties of the entity and their associates Current quarter
$A'000
6.1 Aggregate amount of payments to related parties and their associates included in item 1 56
(refer to quarterly activity report for further details)
6.2 Aggregate amount of payments to related parties and their associates included in item 2 0
6.3 Aggregate amount of payments to related parties and their associates included in item 3 0
(refer to quarterly activity report for further details)
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Cluey Ltd

ASX: CLU

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7. Financing facilities Total facility at Amount drawn at
quarter end quarter end
$A'000 $A'000
7.1 Loan facilities 0 0
7.2 Credit standby arrangements 0 0
7.3 Other (please specify) 0 0
7.4 Total financing facilities 0 0
7.5 Unused financing facilities available at quarter end 0
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• 7.6 Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well. None

8. Estimated cash available for future operating activities 8.1 Net cash from / (used in) operating activities (item 1.9) 8.2 Cash and cash equivalents at quarter end (item 4.6) 8.3 Unused finance facilities available at quarter end (item 7.5) 8.4 Total available funding (item 8.2 + item 8.3) 8.5 Estimated quarters of funding available (item 8.4 divided by item 8.1)	$A'000 (3,775) 31,878 0 31,878 8

• 8.6 If item 8.5 is less than 2 quarters, please provide answers to the following questions: 8.6.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?

Answer: n/a

8.6.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful? Answer: n/a

8.6.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis? Answer: n/a

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Date: 20 April 2021

Authorised by: the Board of Cluey Ltd